In Patricia Lam v HMRC [2018] TC6540 a taxpayer found that the fact that you stay a few nights in your property in a sleeping bag is unlikely to convince a tax tribunal that a property is your only or main residence.

  • Mrs Lam lived in London, she bought a second property in Hertfordshire to renovate.
  • She and her husband lived at their home whilst her husband renovated the Herts property, which was later sold at a substanital gain.
  • She failed to declare any Capital Gains Tax on her Herts property and claimed CGT Private Residence Relief on the basis that the property was her main residence.
  • She claimed that she stayed in the property, in a sleeping bag to decide whether it would become her home.

HMRC assessed her for CGT on her gain.

The FTT denied her relief as she provided no evidence of actual occupation, she had moved no furniture into the property and it was found that it was uninhabitable due to storm damage.


With hindsight, the taxpayer could have:

  • a) considered 'quality of occupation' and other essential criteria for a successful claim for PPR.
  • b) considered making a PRR election

See CGT Private Residence Relief (subscriber guide). Copies of this invaluable guide are available separately, contract Virtual Tax Support for details.

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Patricia Lam v HMRC [2018] TC6540